Matthew Ferrara, Philosopher

All posts tagged mortgage

What one phrase has done more damage to the housing industry – consumer and practitioner alike – in the last two years? “I’m waiting for the bottom.” Buyers have been sitting on the sidelines, waiting for prices to hit their lows. Those REALTORS who didn’t just quit (200,000-plus of them did) similarly stuck their heads in the sand, waiting for everything to just blow over. “When the market changes,” was the favorite phrase of meetings, workshops, articles and convention speakers. A few out there – the Harneys, the Stavers, even yours truly – continued to plead for sanity. Nobody has  Read more

Like a three ring circus, the housing bill distracts the American taxpayer with shiny baubles. Behind the scenes however, the bill will likely destroy the housing industry and the careers of millions of REALTORS. Yet the moths continue to fly toward the fire, praising the insidious federal policy of giving away down-payments to buyers, forcing banks to write down mortgage principle, and protecting non-paying borrowers. All this , and more, just to set the stage for the big act: Commission caps for REALTORS. Really. Haven’t Fannie Mae and Freddie Mac done enough harm already? Remember Barney Frank’s “roll the dice”  Read more

Warren Buffet likes to say, “When others are greedy, I’m fearful; when others are fearful, then I’m greedy.” As a rule for when to invest in the stock markets, the Sage of Omaha is cautioning the average investor against the psychology of the markets. Mass markets – like stocks, bonds and even housing – are subject to mood swings by the consumer. And frenzies – to purchase or sell – are the scariest moods of all. Buffets advice: Do the opposite of the frenzy, and you’ll be just fine. Now let’s apply that thinking to the “lower mortgage rates” frenzy  Read more

Is it possible that the Federal Reserve, despite all of its protestations to the opposite, really hates the housing industry? Could Bernanke and the rest of the Fed cronies not only be totally incompetent, but actually have a vendetta against the middle class? Is there any evidence that the Fed is out to absolutely destroy the housing market even as it professes to be trying to save it. You bet. And for proof, here’s a little Economics 101. The housing market is a commodity market. Producers create an asset whose price fluxuates according to two factors. The first is consumer  Read more